Toggle navigation
Toggle navigation
Home
DCUM Forums
Nanny Forums
Events
About DCUM
Advertising
Search
Recent Topics
Hottest Topics
FAQs and Guidelines
Privacy Policy
Your current identity is: Anonymous
Login
Preview
Subject:
Forum Index
»
Money and Finances
Reply to "Valuation of Pension for Retirement Planning"
Subject:
Emoticons
More smilies
Text Color:
Default
Dark Red
Red
Orange
Brown
Yellow
Green
Olive
Cyan
Blue
Dark Blue
Violet
White
Black
Font:
Very Small
Small
Normal
Big
Giant
Close Marks
[quote=Anonymous]There are two ways that personal financial assets are better than pensions: 1) if you die EARLY, the expected value of the pension gets curtailed while the same value in personal assets lives on; 2) pensions are essentially locked at a bond rate while personal assets may be invested more aggressively. For example, some retirees may hold only 2-5 years expenses in cash/tbills and keep the rest in stock. That portfolio would compound at a much higher rate than one with half or more assets in a pension. On the other hand, a pension is mostly guaranteed cash flow while stocks returns are uncertain and investors can lose capital. There are many retirees who cannot stomach the volatility of the market, and thus have very conservative portfolios, like 50/50 stock/bonds, which is essentially 50/50 stock/pension. In that case, the main shortfall of too many pension assets is the risk of EARLY death with no or greatly reduced survivor benefit. [/quote]
Options
Disable HTML in this message
Disable BB Code in this message
Disable smilies in this message
Review message
Search
Recent Topics
Hottest Topics
